Increasing foundry and materials costs are prompting some major IC vendors in Taiwan to decide to raise their product prices in fourth quarter of 2021. In China, many components makers are being affected by the Chinese government's decision to cut power supply to industrial users in line with its carbon reduction policy. PCB suppliers will find out this week whether Apple will increase or cut orders for the iPhone 13 series.
Taiwan's OSATs have seen their plants in Suzhou, Jiangsu province little affected by a power supply cut enforced by China under its carbon reduction policy, but they are more concerned that year-end labor shortage may impact their production and shipments, according to industry sources.
Answering calls from the US government to take back control of the supply chain, Intel is seeking to partner with Qualcomm and Amazon in a bid to reshape the wafer foundry industry. Intel has unveiled its IDM 2.0 business model and set a goal to implement 2nm node process technology within three years, looking to challenge TSMC's and Samsung's 3nm technologies. Intel also claims that the plan has been supported by Qualcomm, the world's largest communication chipmaker, and AWS, the leading player in cloud services.
The supply chain shortage has not seen any relief in 2021, particularly when it entered the third-quarter traditional electronic peak season. Market demand has increased, but overall production capacity has not.
Display driver IC backend specialists Chipbond Technology and ChipMOS Technologies are looking to enhance their high-end testing capability, eyeing promising growth in demand for automotive DDIs, according to industry sources.
IDMs including TI, Infineon, STMicroelectronics and Microchip have all stepped up their deployments in the market for power devices using GaN, SiC and other third-generation semiconductor materials, according to industry sources.
TSMC, Intel and Samsung continue to compete for the leadership in more advanced technologies beyond 7nm node. Samsung has already foretold that it will mass produce for 4nm technology in 2021, with the 3nm process likely to be available in 2023. In the future, Samsung will produce its own chips with its 3nm GAAFTE process. As we all know, Samsung has a lot of contracts from its internal system design center. Only when Samsung wins orders from external customers can there be structural improvements. But many external customers are wary of Samsung's dual role as player and referee which leverages its technology, production capacity and market operations against its customers. Samsung has considered spinning off its wafer foundry business to endorse its credibility, but has not made a move because semiconductor is a highly capital-intensive industry. TSMC has announced that between 2021 and 2023 it will invest US$100 billion or an annual capital expenditure of US$30 billion for capacity expansions. The budget is more than double Samsung's sales from wafer foundry business. A spun-off Samsung foundry business wouldn't be able to afford such big investments all on its own, and would face enormous challenges trying to make profits.
Intel is scheduled to hold a groundbreaking ceremony for the construction of two new fabs in Arizona on September 24. Company CEO Pat Gelsinger and local government officials will participate in the ceremony to mark what Intel claims is the largest private-sector investment in the history of Arizona.
Chromebooks with 14- to 15-inch displays are currently having the worst shortages as orders from the education segment are shifting from the elementary to middle school levels - which are commonly using 11.6-inch models for their study-from-home needs - to high school and college levels, according to Acer chairman and CEO Jason Chen.
Nan Ya PCB is set to commercialize new ABF substrate capacity by the end of 2021 and will scale up its output substantially for AMD's processors in the second quarter of 2022, which is expected to help the US chipmaker significantly drive up its shipments, according to industry sources.
According to market research reports, the global wafer foundry market size was about US$82 billion in 2020, with TSMC having a 55% global market share, and Samsung taking only 15%. In terms of profit in the global wafer foundry sector, TSMC took nearly 85%, compared with less than 5% for Samsung. In other words, TSMC's profit in wafer foundry business was 17 times Samsung's. Evidently, the two players are competing in different divisions. But why has Samsung been so constantly provocative? Why is South Korea going all-out, vowing to be a dominant power in the global semiconductor industry by 2030?
Total foundry sales this year will surpass the US$100-billion mark for the first time, and continue increasing at a strong 11.6% average annual growth rate through 2025 when total foundry sales are expected to reach US$151.2 billion, according to IC Insights.
China-based Zing Semiconductor is expected to see its monthly production for 12-inch silicon wafers ramp up to one million pieces by 2025 from the current level of 250,000, according to company chairman Wei Li.
Since the 1970s, Taiwan and South Korea have been parallelly developing semiconductor and new-geneation IT industries. The national conditions and industrial strength of the two countries are very similar. During the Cold War, Taiwan and South Korea were part of the first island chain facing the communist world. Now the US and China are rivals that compete head to head with not only weaponry, but also the strength of the technology industry, the most representative of which is the semiconductor industry and the ubiquitous supply chain. About 60% of Taiwan's and Korea's semiconductor exports go to China. In 2020, China imported as much as US$350 billion of semiconductors, with about half of them from Taiwan and South Korea. Taiwan and South Korea both export enormously to China on the one hand, and vie for the industry leadership position on the other. South Korea specializes in memory, but Taiwan's industry structure is more diverse: wafer foundry, IC design, packaging and testing. Taiwan and South Korea dislike each other but also rely on each other.
Fabless chipmakers are looking to step up their deployments in the 5G RF front-end module (RF FEM) and other device markets by working closely with their manufacturing partners, according to industry sources.
Following in the footsteps of International IDMs and automakers to promote their SiC components for EVs, China auto and semiconductors makers are also preparing their homegrown SiC chips and modules for EV applications. After the announcement to develop SiC components a few weeks ago, Foxconn continues its investment in EV business with PPT in Thailand to expand its EV supply chains to Southeast Asia. In addition to EV manufacturing, its maintenance service recently has aroused many discussions from different sides, due to the eight-year warrants of early Tesla Model S and Model X being expired soon.
Taiwan-based chipmaker MediaTek announced its plans to recruit more innovation staff in India to support local manufacturing, according to PTI, although the actual number of new employees they are looking for is not disclosed.
Mirle Automation, dedicated to supplying automated logistics systems and flat panel display (FPD) transporting equipment, has seen its backlog of orders exceed NT$10 billion (US$360.6 million), which is over 20% above the level a year earlier, according to the company.